The Mystery Of The “Surplus” City Buildings - And Response (2)

Sunday, August 12, 2018

Mayor Berke’s Administration recently asked the Chattanooga City Council to declare “surplus” three city owned buildings near City Hall so they could be sold to private developers.  

Property is typically considered "surplus" when it no longer serves the needs of the city and, therefore, the public. Two of the buildings are currently being used. Where are these employees going? What is the cost of the move, both long-term and short-term? What impact will moving them have on efforts over the years to create a city "campus" where city offices are close to one another? 

The properties under consideration to be “surplused" and sold are the "Internal Audit" building on Lindsay Street, the former Senior Neighbors/Wellness building on E. 10th St. at Houston, and the City Hall Annex on E. 11th Street where the city attorneys and 311 are located. The IT Department had been in the annex, but last year the city leased space for them in the Edney Building for $662,000 over a four-year period. 

As of Aug. 7, 2018, the City Council and the public had not been provided with a fiscal impact analysis or information on how the buildings would be sold, whether there would be an appraisal, what the evaluation criteria would be in determining the successful buyer, where the city employees currently in these buildings would go, how much the city might be looking at in future lease payments, and whether informal “negotiations” with building owners have already taken place.  

The issues here are government transparency and wise use of taxpayer dollars.  

Public-private partnerships may be appropriate at times, but they require a strong negotiator for the public at the table. Unfortunately, that has not always been the case on past property transactions such as the King Street parking lot and on tax incentives agreements for PILOTs and TIFs. 

Helen Burns Sharp and members of the organization she founded, Accountability for Taxpayer Money (ATM) raised most of these issues at the June 24 and Aug. 7 Council meetings. On July 31, Council voted to defer action until they got definitive information from the Mayor’s Administration. Council members likely have raised their own questions and seem committed to getting satisfactory answers. However, resolutions to declare the properties surplus and transfer them to the CDRC remain on the Aug. 14 City Council agenda. 

ATM also asked why these properties need to be transferred to the Chattanooga Downtown Redevelopment Corporation. Why can't the Council act for the city? Council members are elected by Chattanooga citizens and are therefore accountable.  

We have also just learned that the CDRC will be asked on Monday, Aug. 13, to enter into a Development Services Donation Agreement with the Enterprise Center for the purpose of overseeing the solicitation of development for the three properties if/when they are declared surplus by the City Council.  

Such an arrangement raises the appearance of a conflict-of-interest in that the Enterprise Center works closely with the owners of buildings who might be interested in buying the city properties or leasing the city office space, including the owners of the Edney Building where the Enterprise Center is located.   

These properties fall within the 140-acre Innovation District, which is managed by the Enterprise Center. Mayor Berke, in his recent State of the City Address, announced that the city is offering up these buildings to help stimulate mixed use development.  

Has the Council heard a presentation on this concept? Is the thinking that the properties will pay enough over time in property tax to justify the city having to pay for office space elsewhere? Might the Innovation District later be proposed as a tax increment financing (TIF) district? That would mean that for 15 years property taxes would not go to the General Fund to fund basic services such as fire and police and street paving. 

Who is looking out for the public interest? 

Franklin McCallie

* * *

I fully agree with Franklin MCCallie. The Berke administration want to declare three buildings "surplus" in order to sell them to developers?

 

The mayor will pressure the City Council who all seem to cow-tow to him and said developers. I also assume that the Council will declare the buildings surplus, sell them cheap to a developer, and then give them a TIF. 

 

This makes me very angry and disgusted.

 

Chattanooga will soon have a glut of apartments. The overbuilding and rape of our town and neighborhoods is starting to have a negative impact on everything from the overflowing sewers to increased traffic and the stress on the infrastructure. 

 

But, the developers and the city government are happy.

 

Alison Falinski

North Chattanooga

 

* * * 

 

I wholeheartedly agree with the previous assertions regarding the "surplus" buildings and their proposed sale to developers.  The complete disregard for taxpayers and continued courting of developers, without any requirement for responsibility on the part of those same developers is deplorable.  How many cheaply constructed apartments do we need before the current administration will be satisfied?  Who is to pay for the ensuing public works expenses? Let me guess.  It won't be developers. 

 

Watch for the subject of these buildings, along with that of the Vegas light show on the bridge, to rear its head again. 

 

The mayor's office acts with transparency and openness? Really?  Methinks the gentleman doth protest too much.

 

Darlene Kilgore



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